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Money in monetary policy design under uncertainty: A formal characterization of ECB-style cross-checking

Beck, Günter W.; Wieland, Volker - 2006

The European Central Bank has assigned a special role to money in its two pillar strategy and has received much … criticism for this decision. The case against including money in the central bank's interest rate rule is based on a standard … decades. In this paper, we develop a justification for including money in the interest rate rule by allowing for imperfect …

Persistent link: https://www.econbiz.de/10010298367

Money in monetary policy design under uncertainty: The two-pillar Phillips curve versus ECB-style cross-checking

Beck, Günter W.; Wieland, Volker - 2006

The European Central Bank has assigned a special role to money in its two pillar strategy and has received much … criticism for this decision. In this paper, we explore possible justifications. The case against including money in the central … contributions to research on monetary policy in the last two decades. Of course, if one allows for a direct effect of money on …

Persistent link: https://www.econbiz.de/10010298366

Insurance policies for monetary policy in the Euro area

Küster, Keith; Wieland, Volker - 2005

In this paper, we examine the cost of insurance against model uncertainty for the Euro area considering four alternative reference models, all of which are used for policy-analysis at the ECB.We find that maximal insurance across this model range in terms of aMinimax policy comes at moderate...

Persistent link: https://www.econbiz.de/10010298303

Stochastic optimization and worst-case analysis in monetary policy design

Rustem, Berc; Wieland, Volker; Zakovic, Stan - 2005

In this paper we compare expected loss minimization to worst-case or minimax analysis in the design of simple Taylor-style rules for monetary policy using a small model estimated for the euro area by Orphanides and Wieland (2000). We find that rules optimized under a minimax objective in the...

Persistent link: https://www.econbiz.de/10010298304

Regional inflation dynamics within and across euro area countries and a comparison with the US

Beck, Günter W.; Hubrich, Kirstin; Marcellino, Massimiliano - 2006

We investigate co-movements and heterogeneity in inflation dynamics of different regions within and across euro area countries using a novel disaggregate dataset to improve the understanding of inflation differentials in the European Monetary Union. We employ a model where regional inflation...

Persistent link: https://www.econbiz.de/10010298350

The European Central Bank

Binder, Michael; Wieland, Volker - 2006

The establishment of the ECB and with it the launch of the euro has arguably been a unique endeavor in economic history, representing an important experiment in central banking. This note aims to summarize some of the main lessons learned from this experiment and sketch some of the prospects for...

Persistent link: https://www.econbiz.de/10010298352

The predictability of monetary policy

Blattner, Tobias; Catenaro, Marco; Ehrmann, Michael; … - 2008

Current best practice in central banking views a high level of monetary policy predictability as desirable. A clear distinction, however, has to be made between short-term and longer-term predictability. While short-term predictability can be narrowly defined as the ability of the public to...

Persistent link: https://www.econbiz.de/10011606235

The impact of the global economic and financial crisis on central, eastern and south-eastern Europe: A stock-taking exercise

Gardó, Sándor (contributor); Martin, Reiner (contributor) - 2010

The paper first reviews the main drivers of the growth and real convergence process in central, eastern and south-eastern Europe (CESEE) since 2000 and assesses the key macro-financial strengths and vulnerabilities of the region at the beginning of the global economic and financial crisis. The...

Persistent link: https://www.econbiz.de/10011606266

The Stability and Growth Pact - crisis and reform

Schuknecht, Ludger; Moutot, Philippe; Rother, Philipp; … - 2011

The sovereign debt crisis in the euro area is a symptom of policy failures and deficiencies in – among other things – fiscal policy coordination. The first nine years of the euro were not used effectively in order to improve public finances, while the Stability and Growth Pact was watered...

Persistent link: https://www.econbiz.de/10011606281

Lessons for monetary policy: What should the consensus be?

Issing, Otmar - 2011

This paper outlines important lessons for monetary policy. In particular, the role of inflation targeting, which was much acclaimed prior to the financial crisis and since then has not lost much of its endorsement, is critically reviewed. Ignoring the relation between monetary policy and asset...

Persistent link: https://www.econbiz.de/10010308567